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Li urges foreign firms to increase spending

By DING QINGFEN | China Daily | Updated: 2013-06-06 01:42

Premier promotes opportunities from nation's rapid development

Premier Li Keqiang encouraged foreign businesses to increase investment in China on Wednesday, especially in science and technology, saying China has the capability to put economic growth on a sustainable and healthy track.

Li urges foreign firms to increase spending

Premier Li Keqiang meets with visiting former US treasury secretary Henry Paulson in Beijing on Wednesday. Xu Jingxing / China Daily

Foreign companies' experience and innovation can combine well with China's market potential and demand, Li said during a meeting in Beijing with executives from more than 10 multinationals that will attend the Fortune Global Forum 2013.

The forum is being held in Chengdu, Sichuan provincial capital, from Thursday to Saturday.

Li's comments come as China's economic growth has slowed during the past few quarters, with experts expressing concerns that foreign companies will be discouraged from investing in the world's second-largest economy.

But Li attempted to end the doubts, saying foreign businesses should cash in on the huge opportunities resulting from the nation's economic development by expanding local investment, particularly in science and technology, research and development.

While the global market remains grim, China's efforts on industrialization and urbanization will translate into huge demand for multinationals, he said.

Slowed growth

China's annual economic growth slowed to 7.7 percent in the first quarter from 7.9 percent the previous quarter.

The International Monetary Fund has cut its 2013 economic growth estimate for China to 7.75 percent from 8 percent, while the Organization for Economic Cooperation and Development reduced its growth forecast to 7.8 percent from 8.5 percent.

A key issue facing China in the future will be how to make economic growth sustainable and healthy, but the nation has the capability and conditions to do so, Li said.

"China will be committed to deepening the reform and opening-up policy," he added.

The country's foreign direct investment in 2012 hit a record high of $111.7 billion, according to the Ministry of Commerce.

China has been the most appealing FDI destination among developing countries for more than a decade. But 2012 was the first year the nation saw a drop in its annual FDI since 2009. The decline was reversed in the first quarter this year.

Despite the central government's promise to improve the foreign business climate, factors including rising labor costs, protection of intellectual property rights and market access have been sources of complaints from foreign companies about doing business in China. This year is the first time the Fortune Global Forum has been held in China's western region.

Representatives from the foreign companies that held talks with Li said they "attach great importance to the Chinese market, and are willing to deepen investment cooperation with China and to grow with China", according to a release from the Ministry of Foreign Affairs.

In recent years, the central government has been encouraging foreign companies to invest in the central and western regions where labor costs are comparatively low.

In May, China launched a new version of guidelines on encouraging foreign companies to invest in more industries in the central and western regions.

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